At 10:44, BSE Sensex was trading at 70,483.02, down over 570 points or 0.81%. Nifty50 was at 21,302.95, down over 150 points or 0.70%.
Tech Mahindra, one of the bluechip stocks, fell 5.5% in early trade after reporting lower-than-expected profits for the third quarter. Other IT stocks like HCL Tech, Infosys, TCS, and Wipro also opened in the red.
Zee Entertainment Enterprises saw a decline of 2.3% after the Enforcement Directorate (ED) conducted a search at Zee owner Essel Group’s office in Mumbai, according to media reports.
Raitel Corporation of India shares, on the other hand, opened 5% higher after posting a quarterly profit that almost doubled compared to the previous year.
In terms of sectors, Nifty IT fell 0.87% and Nifty Pharma dropped 0.64%. Nifty Bank, Auto, Financial Services, Metal, and Consumer Durables also opened lower. However, in the broader market, Nifty Smallcap100 surged 0.46%, while Nifty Midcap100 rose 0.1%, according to an ET report.
According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the ongoing tug of war between the FIIs and DIIs will keep the volatility high in the near term. He suggests that investors may take advantage of this volatility to make changes to their portfolios. Vijayakumar also expressed concern about the rising bond yields in the US, indicating that the Fed rate cut may not happen until the second half of 2024.
Aditya Gaggar, Director of Progressive Shares, pointed out that a bullish candlestick, along with cypher pattern and hidden bullish divergence in RSI, suggests a trend reversal. He identified the immediate resistance levels at 21,500 and 21,700, with support at 21,200.
In global markets, Asian stocks traded cautiously while waiting for more details on China’s stimulus plans and the European Central Bank meeting. Japan’s Nikkei fell 0.3%, while the Hang Seng rose 1.2% and mainland indexes remained steady. S&P 500 and Nasdaq 100 futures were slightly lower in Asia, with Tesla shares dropping 6% after earnings missed expectations.
Foreign institutional investors (FIIs) continued to sell for the sixth consecutive session, offloading shares worth about $834 million, according to exchange data.